December 2, 2017

Expanding The Reach Of Central-Planning Regimes

A weekend topic on central planning and the housing bubble, starting with Bloomberg. “Central bankers are starting to see promising results from one of the recent additions to their monetary policy toolbox. Lending curbs to stem financial risk — so-called macroprudential limits — have helped slow risky borrowing and temper property price bubbles in countries from New Zealand to Canada, a host of financial stability reports showed this week. While there hasn’t been uniform success — Hong Kong’s housing market shows no signs of cooling — it’s given central banks some breathing space to be more gradual in tightening monetary policy.”

“‘If you think about lessons from the global financial crisis, macroprudential is one of the key lessons,’ said Steven Bell, chief economist at BMO Global Asset Management in London. ‘It was a tool of counter-cyclical credit tightening, and I think that’s going to be a permanent feature.’”

“Global policy makers aren’t off the hook yet. Stricter financing rules may have curbed excesses, but household debt remains high in many countries, say analysts at Citigroup Inc. The Swedish Financial Supervisory Authority said in its financial stability report that housing and debt risks are still elevated, even though capital and lending requirements for banks have been raised for years in order to stem risk.”

From Canadian Mortgage Trends. “More than 1,200 mortgage professionals from across the country descended upon Niagara Falls for Mortgage Professionals Canada’s annual National Mortgage Conference. OSFI’s new B-20 mortgage rules dominated discussions. Former Prime Minister Stephen Harper critiqued the current government’s implementation of recent mortgage rule changes by saying, ‘[When in government] we did our consulting with industry members before announcements, not after.’”

“‘The percentage of homes being done at 30 years [amortization] has gone up materially in the last six months,’ said Mark Aldridge, CEO of MCAP. He added that he believes the bigger issue is not the impact on new buyers, but instead those renewing their mortgages who have never missed a payment, but won’t be able to qualify under the 200-bps stress test. ‘You’re stuck at that bank. And believe me, the banks have the data, so they can charge 20 bps, 30 bps more on customers who have nowhere to go… In the interest of financial stability, we push competition to the side and it’s going to be consumers, it’s going to be probably 20% of mortgage consumers out there, that suffer from that.’”

From Fairfax Media in New Zealand. “Business confidence has taken another tumble, falling to the lowest level in more than eight years. The ANZ business outlook survey found a net 39 per cent are pessimistic about the economy over the coming year, a 29 point fall since October. The latest survey is the first of its kind to be taken since the new Labour-led Government was formed.”

“‘Uncertainty around changing Government policy, a softer housing market, and difficulty getting credit are likely culprits,’ ANZ chief economist Sharon Zollner said. ‘The economy is at a delicate juncture as migration, construction and housing run out of steam as growth drivers. Zollner said while it was the first survey of its type that ANZ had conducted since Jacinda Ardern became prime minister, ‘it would be too simplistic to ascribe the full move to the change of government. There is a lot else going on. The softening in house price inflation is one obvious factor that shouldn’t be overlooked (particularly its importance for the retail sector), as is the reported difficulty of getting credit.’”

From Channel News Asia. “The recent wave of collective sales and an increase in land prices prompted the Monetary Authority of Singapore (MAS) to sound a note of caution on the local property market. In its latest annual review of financial stability, the central bank said that these recent developments could bring about risks to the ’sustainable conditions’ in the market.”

“Industry observers said the warning from MAS follows a similar call for prudence from National Development Minister Lawrence Wong earlier this month. It also comes on the back of new rule changes, – a sign that some analysts interpreted as authorities beginning to cast a watchful eye on the collective-sale fever. Ms Christine Li, research director at Cushman & Wakefield, noted that several en bloc sales launched since last year involve huge sites, where the number of units in the new projects may be three or four times that of the existing units. While the market is nowhere near oversupply for now, this ’spike’ in the number of new homes at each site may pave the way for a supply glut further down the road, Ms Li added.”

From Quartz on China. “China has a master plan to oust the US as preeminent global superpower—and this time it just might work. That’s according to the Washington Post’s David Ignatius, citing two Pentagon briefs. ‘There’s an eerie sense in today’s world that China is racing to capture the commanding heights of technology and trade. Meanwhile, under the banner of ‘America first,’ the Trump administration is protecting coal-mining jobs and questioning climate science,’ he concludes. ‘Sorry, friends, but this is how empires rise and fall.’”

“The ‘China is taking over the world’ meme is a perennial one. As usual, this argument overlooks what’s happening within China’s borders. That includes: a credit-driven growth model that has left debt growing faster than the economy, the continued dominance of inefficient state-owned enterprises (SOEs) at the expense of dynamic private firms, and a fiscal system that depends on a housing bubble to sustain it.”

“More foreboding is the intensifying of the Party’s control of digital networks and personal information, and the spread of China’s tightly sealed internet into Africa and central Asia. Major vehicles for this ‘internet sovereignty’ strategy are the Chinese tech companies once praised as the embodiment of dynamism and innovation. Whether swearing fealty to Xi boosts the global competitiveness of Tencent, Alibaba, and the others may be revealing.”

“Even that campaign, however, works not by seizing the reins of the existing global order, but rather by expanding the reach of Xi’s central-planning regimes. The core problem for China is: Power doesn’t guarantee competence. And Xi’s handling of the domestic economy in the past half-decade suggests a dearth of the latter.”

From City Journal. “The Republican tax-reform plan, if adopted, would put on the chopping block some cherished tax deductions—perhaps none more so than the $80 billion mortgage-interest deduction (MID) on residences, which mostly benefits affluent homeowners. As the various bills under consideration propose, the deduction should be pruned or eliminated—not just because it is inequitable but also because it distorts the housing market.”

“The effects on home prices vary by city, but there’s good evidence that cutting back the MID would lower prices in high-cost areas, where newcomers find it difficult to move nowadays. Benjamin Harris, who served as chief economist for former vice president Joseph Biden, wrote in a doctoral dissertation that abolishing the MID ‘would lead to a 28 percent decline in metropolitan-area housing prices in cities where the average taxpayer buying a new house is in the 35 percent tax bracket.’”

“Not surprisingly, the homebuilders lobby—among the hardiest of Washington swamp creatures—is fighting the proposal. In a moment of candor, however, homebuilding industry executive, Glenn Kelman, who heads the national real estate brokerage firm Redfin, told the New York Times, ‘The current tax code favors people who are buying a home versus the rest of America,’ he said. ‘As a captain of industry, I would prefer more tax breaks to help people buy houses, but as a citizen, I realize someone has to pay.’”

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Comment by Ben Jones
2017-12-02 06:57:28

A comment to the last link:

‘Interesting analysis, but the ONE ODD FACT contained in the article has me in total disbelief - JOE BIDEN HAD AN ECONOMIC ADVISER??’

Comment by 2banana
2017-12-02 07:26:12

Crazy Joe could have used more than an economic advisor.

I will put a bet of steak dinner he is one of the 235 politicians who settled sexual harassment claims with the secret taxpayer slush/settlement fund.


Former Joe Biden Secret Service Agent: We Had to Protect Women From Him, ‘Weinstein Level Stuff’
Gateway Pundit | 11/17/2017 | Jim Hoft, Cassandra Fairbanks

A former Secret Service agent assigned to the Vice President Joe Biden residence claims that the Service often had to protect female agents from him.

Speaking on the condition of anonymity, the agent asserted that, “We had to cancel the VP Christmas get together at the Vice President’s house because Biden would grope all of our wives and girlfriend’s asses.” The annual party was for agents and Navy personnel who were tasked with protecting the Biden family.

“He would mess with every single woman or teen. It was horrible,” the agent said.

According to the source, a Secret Service agent once got suspended for a week in 2009 for shoving Biden after he cupped his girlfriend’s breast while the couple was taking a photo with him. The situation got so heated, the source told Cassandra Fairbanks, that others had to step in to prevent the agent from hitting the then-Vice President.

Additionally, the agent claims that Biden would walk around the VP residence naked at night. “I mean, Stark naked… Weinstein level stuff,” he added.

Comment by Mr. Banker
2017-12-02 08:13:16

“’He would mess with every single woman or teen. It was horrible,’ the agent said.”

Not horrible, a fringe benefit.

“According to the source, a Secret Service agent once got suspended for a week in 2009 for shoving Biden after he cupped his girlfriend’s breast while the couple was taking a photo with him.”

Check out who it was who got a quick feel and then check out who it was that got suspended for a week.

It’s good to be the king.

Comment by Mr. Banker
2017-12-02 08:27:41

“… a fringe benefit.”

Not only a fringe benefit but a reminder to all just who it is that possesses power and who it is that does not.

This is no small matter in the world of power in that the use of power must be exhibited at every opportunity as reminder to all who it is that has power and how much power they have.

Power begets power. Use it or lose it.

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Comment by Professor 🐻
2017-12-02 08:53:01

“Power corrupts. And absolute power corrupts absolutely.”

Comment by 2banana
2017-12-02 08:57:36

“Power corrupts. And absolute power corrupts absolutely.”

Thus the beauty of small, limited and divided government.

But today, if you want that, it makes you a Nazi.

And the SJW don’t get the historical irony.

Comment by butters
2017-12-02 14:48:00

Thus the beauty of small, limited and divided government.

But the biggest military though, right?

Comment by scdave
2017-12-02 16:10:57

But the biggest military though, right ??

Well sure. Nobody is going to step in front of that gravey train. It’s for the children don’t you know.

Comment by Professor 🐻
2017-12-02 18:09:48

Military is not the government…right?

Comment by oxide
2017-12-02 11:33:24

It’s not surprising for high level officials to have lots of staff. Every member of Congress has a staff. Senators have their own speechwriters; I’ve met one. And in 2009,Obama made Biden the Czar of Helping out the Middle Class (forgot the actual name), so yes I would expect Biden to have an economist.

Banana, isn’t that hush fund for Congress only? If Biden is on the list, then it was for behavior as a Senator. I don’t see an issue with walking around the VP residence naked… that’s his personal house.

Comment by Taxpayers
2017-12-02 13:50:30

Biden’s economist is a total lefty

Comment by butters
2017-12-02 14:29:42

Nah. One of the advisors he had early on was Jared somebody. He’s as centrist as they come. Centrist meaning Wallstreet peons.

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Comment by SFMF
2017-12-02 14:51:13

Google creepy Joe Biden video…..

Comment by Professor 🐻
2017-12-03 08:30:16

“The effects on home prices vary by city, but there’s good evidence that cutting back the MID would lower prices in high-cost areas, where newcomers find it difficult to move nowadays. Benjamin Harris, who served as chief economist for former vice president Joseph Biden, wrote in a doctoral dissertation that abolishing the MID ‘would lead to a 28 percent decline in metropolitan-area housing prices in cities where the average taxpayer buying a new house is in the 35 percent tax bracket.’”

Who knew that Joe Biden’s personal economist uncovered the secret to affordable housing in his doctoral dissertation? Simply eliminate the mortgage interest deduction, and the affordability problem in the blue states will largely go away.

Comment by Ben Jones
2017-12-03 08:40:53

And notice no mention of overbuilding to accomplish that, which certainly imperils the earth by contributing to global warming.

Comment by BlackSwandive
2017-12-03 23:24:28

The damage to the earth and the horrific waste of natural resources is my greatest regret of this entire bubble. It’s despicable.

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Comment by Anonymous
2017-12-03 12:39:29

This is awesome! Thx! :D

Comment by Senior Housing Analyst
2017-12-02 07:00:10

San Diego (Tierrasanta), CA Housing Prices Crater 14% YOY

Select price from dropdown menu on first chart

Comment by 2banana
2017-12-02 07:04:58

The world changed yesterday.

Obamacare mandate repeal - which basically repeals obamacare

Tax reform passes - crushing blue state housing

The Wall will be built after the travesty of the Kate Steinle trial

Flynn was a big nothing burger


Senate GOP repeals ObamaCare mandate
The Hill | December 2, 2017 | Peter Sullivan

Senate Republicans have approved the repeal of ObamaCare’s individual mandate as part of their tax-cut bill, a major step forward toward ending an unpopular part of the healthcare law.

“Families ought to be able to make decisions about what they want to buy and what works for them –not the government,” Sen. John Barrasso (R-Wyo.) said, hailing the accomplishment.

“I believe if people don’t want to buy the Obamacare insurance, they shouldn’t have to pay a tax penalty to the IRS.”

The Senate tax bill must still be reconciled with House legislation that does not include the mandate’s repeal. But that is unlikely to be a major issue given support in the GOP conference for repealing the mandate.

Comment by jeff
2017-12-02 07:35:19

“Flynn was a big nothing burger”

Flynn was charged with lying to the FBI about something that was legal.


FBI: What did you have for lunch on Thursday?

Flynn: A cheeseburger.

3 weeks later

FBI: What did you have for lunch 3 weeks ago on Thursday?

Flynn: A cheeseburger.

4 months later

FBI: What did you have for lunch 4 months ago on Thursday?

Flynn: I think I had a tuna sandwich.

CNN Breaking News

Flynn charged with lying to the FBI

Comment by jeff
Comment by jeff
2017-12-02 21:36:17

Will the Loons at the View be apologizing or suspended on Monday?

ABC Suspends Reporter Brian Ross Over Erroneous Report About Trump

By Vivian Wang
Dec. 2, 2017

Mr. Trump directed Mr. Flynn to make contact after the election, as president-elect, the network said.

ABC said the confidant later clarified that Mr. Trump’s request to Mr. Flynn during the campaign had been to find ways to repair relations with Russia. The directive to contact Russian officials on topics that included working together against the Islamic State came after the election, the network said.

“It is vital we get the story right and retain the trust we have built with our audience — these are our core principles,” the ABC statement said. “We fell far short of that yesterday.”

Kathleen Culver, the director of the Center for Journalism Ethics at the University of Wisconsin-Madison, said the mistake would give fresh ammunition to Mr. Trump and other conservatives who have attacked the credibility of news organizations, especially those that have reported negatively on the administration.

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Comment by jeff
2017-12-02 21:46:07

Since ABC suspended reporter Brian Ross over erroneous report about Trump the Joy Beyhar video was taken down

Joy Behar and ‘The View’ Audience Cheer Flynn’s Guilty Plea: ‘Lock Him Up’

by PAM KEY 1 Dec 2017

Friday on ABC’s “The View,” co-host Joy Behar and the live audience applauded the news former National Security Adviser Michale Flynn was charged and pleaded guilty to lying to the FBI.

The audience cheered as Behar said. “Yay. He goes to jail! He goes to jail! He goes to jail! Lock him up!”

Co-host Meghan McCain said, “Take this moment, Joy, take this moment. I give this to you.”

Behar continued, “On election night, I had to wear a veil, I was in mourning. So this is like the antithesis of that hideous night, and that is why I am happy.”

She added, “It should lead to resignation. I remember Richard Nixon, and Richard Nixon stepped down, and so should Donald Trump.”

Behar declared, “It’s a happy day, come on. If he is going to be taken down for what he did and this country can start to heal, and parties can work together like Meghan wants it to, then that is a happy day.”

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Comment by oxide
2017-12-02 18:09:15

The Dems believe that Flynn pled guilty because he has dirt on Trump and wants to flip. I heard on the radio that Flynn is in financial trouble. It’s entirely possible that Flynn pled guilty simply to get a better deal and avoid legal fees that he can’t afford. He might have no dirt at all.

Comment by Rental Watch
2017-12-02 18:40:46

I have a hard time believing that Trump is simultaneously a complete dumbsh*t, and a criminal mastermind that has yet to be caught by the FBI, yet the left would have us believe that he is both.

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Comment by Carl Morris
2017-12-04 11:15:31

People tend to insult with whatever they are most afraid of someone saying about them. Lefties default to calling people stupid and righties default to calling people immoral. I think the standard insults can be ignored if you want to figure out what people really think.

Comment by Professor 🐻
2017-12-02 07:36:34

“Tax reform passes - crushing blue state housing”

It should be interesting to see if blue state housing investors stick around if Uncle Sugar cuts off their guaranteed housing market wealth gains in perpetuity.

Comment by Ben Jones
2017-12-02 07:43:30

Remember when that sad panda assured us this would never happen? It’s crow eatin’ time.

Comment by Professor 🐻
2017-12-02 08:20:31

Can’t wait to see how Rental Watch spins this development…

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Comment by In Colorado
2017-12-02 09:08:01

FWIW, the SALT deduction will remain with a large cap.

Comment by Professor 🐻
2017-12-02 12:02:16

No surprises if they end up retaining the SALT and MID with small, ineffective tweaks to create the appearance of having done something. I get the concept of political window dressing.

Comment by SW
2017-12-02 12:39:24

I read the SALT deduction was set at $10k max. Anyone have an idea how hard this will hit more expensive states?

Comment by Taxpayers
2017-12-02 13:52:57

Why does Collins of Maine give a sht about salt
It’s a welfare state

Comment by butters
2017-12-02 14:02:47

There are only 100 senators out there. They all think they are big deal even if they are empty suits.

Comment by SFMF
2017-12-02 14:54:43

Fitrst off Susan Collins got in $10K of property tax deduction and MID stays at $1M under the senate plan. My guess is the MID will be at $750K when the house and senate get together.

So pretty much under the tax bill, if you live within 50 miles of an ocean…..get read to pay more. If you live more than 50 miles from an ocean…you will get a nice tax cut.

Comment by butters
2017-12-02 14:59:43

The oceans bring tsunamis as well. Good idea to just rent it like I have done.

Comment by SFMF
2017-12-02 15:03:23

“Why does Collins of Maine give a sht about salt
It’s a welfare state”

Same reasons Kate Steinle’s murderer was found not guilty.

1. A big F.U. to Trump
2. Liberalism is a mental disease

Comment by BlackSwandive
2017-12-02 19:49:29

“Can’t wait to see how Rental Watch spins this development…”

Is Rental Watch a paid troll?

Comment by Mafia Blocks
2017-12-02 20:31:07

Just another degenerate gambler.

Comment by Professor 🐻
2017-12-03 08:32:22


Comment by Rental Watch
2017-12-03 10:34:18

Spin what development?

And no, not a paid troll.

Comment by MacBeth
2017-12-02 09:21:09

Should this become a done deal - the elimination of Obamacare, I mean - it will be the best week we’ve had in decades for those interested in liberty for all individuals.

Protection of the ultimate minority - THE INDIVIDUAL - will always be paramount!

All else is immediately secondary.

Comment by MacBeth
2017-12-02 09:30:13

I wish I had more time lately to post here… there’s been much commentary here lately that I am confounded by.

For example, what’s all if this seeming surprise lately about Big Government and the elitists eating there own? It isn’t surprising. They are on the equivalent of the Titanic.

I have mentioned numerous times during the past five years that Big Government = Titanic. And that anyone employed in government long ago should have their escape route in place.

And my observation is hardly noteworthy.

History is awash with examples of elitists (and their supporter enablers) eating their own. It’s happened throughout human history, all over the world.

Those who siphon wealth out of any economy, out of the pockets of their peers, rather than contribute wealth, will always eat their own.

Comment by Obama Goons
2017-12-02 10:15:45

That is some of the best news to come out of that filthy sewer DC in years, possibly a decades.

Comment by butters
2017-12-02 13:59:29

World didn’t change yesterday.

Health insurance will be as expensive as hell because the core issues haven’t been fixed at all.

Comment by butters
2017-12-02 14:06:18

removing the penalty is excellent indeed The whole idea of forcing people do buy government mandated insurance was a pretty bad deal, but nothing has been solved in regards to corruption in health care industry.

Comment by Mafia Blocks
2017-12-02 17:33:24

You’re right but there has been no greater infringement on the rights of US citizens than forcing them to buy a defective product, by law.

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Comment by MacBeth
2017-12-02 14:33:53

Forcing the populace to pay for something they do not want IS a core issue.

The cost issue can be fixed via free markets.

But nobody wants to play that game. Instead, they’d rather play games of extortion and pimping themselves for votes or freebies.

Comment by oxide
2017-12-02 18:23:05

Unfortunately the populace pays for stuff they don’t want all the time. I don’t like my property tax dollars going for high school for 18-20 year-old illegal immigrants. Other don’t want income taxes to go to drones in Yemen, or thousands of troops in Japan, or SSDI for the able-bodied, or subsidizing Solyndra, or any one of a thousand projects.

I think of the individual mandate — or, more accurately, the penalty — as an emergency room tax. Easy answer is to simply keep records of who didn’t pay the penalty, and if they show up in the ER, let them pay cash or credit or get turned away. It’s draconian, but it will change a few minds.

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Comment by OneAgainstMany
2017-12-02 18:32:57

Let me just say this: solving the cost of sky high healthcare costs in the US is a lot more involved than repealing the ACA mandate. In fact, it’s possible that costs will go up because of this due to adverse selection. I’ve said this before, imagine if we allowed auto drivers to pay for insurance after they got into an accident.

In medicine, a proper treatment plan requires a proper diagnosis. Sadly, the proper diagnosis of the myriad of factors to why costs are exorbitant are not possible in a blog of this sort. But simplistic solutions like “free market health care” are not going to cut it. You don’t shop for a coronary bypass emergency surgery the same way you do a consumer electronic good.

Comment by aNYCdj
2017-12-02 22:16:38

, or SSDI for the able-bodied

seems like on our street at least half a dozen men and a woman got ssdi simply because they were over 50 and obese ohbahma’s SS seemed to be handing this out like candy back in 10-11

Comment by tresho
2017-12-03 07:35:23

seems like on our street at least
Appearances are deceiving. Never judge a person until you have walked a mile in his moccasins. At the very least you’ll be a mile away, and you will have succeeded in stealing a pair of moccasins.

Comment by Taxpayers
2017-12-03 10:43:53

We work 3.6 time the number of hours to pay for hc vs 1950s

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Comment by oxide
2017-12-03 13:02:50

Gimme a break. People had polio in the 50s, and they died of cancer even before they knew it was cancer.

Comment by rms
2017-12-03 13:16:12

Why should a younger healthy person pay the same insurance premiums at work as an upper forties obese smoker? Where’s the competitive free market?

Comment by OneAgainstMany
2017-12-03 17:25:04

Why should a younger healthy person pay the same insurance premiums at work as an upper forties obese smoker?

Guaranteed issue and community rating are concepts used in health insurance. Guaranteed issue means that a health insurance policy is offered to any individual without regard to health status. Community rating means that health insurance providers must offer policies within a giver area the same price to all persons without medical underwriting, regardless of their health status.

The ACA does allow health insurers to discriminate against current smokers by charging up to 50% more. Personally, I think there should be greater price discrimination allowed by insurers. For instance, age permitted banding caps insurance providers from raising insurance rates on older patients. The rate must be no more than 3x the lowest priced policy. This cap doesn’t work since healthcare costs are strongly determined by age, probably more so than health status. I would raise the age band cap to 5 to 1.

Comment by Ben Jones
2017-12-03 19:00:42

‘I think there should be greater price discrimination…The rate must be no more than…I would raise the age band cap…’

Expanding The Reach Of Central-Planning Regimes

Comment by OneAgainstMany
2017-12-03 21:37:50

Actually, it’s the opposite. The ACA restricts insurers from charging more by age, which means that younger, healthier individuals subsidize older, sicker patients. Adjusting this piece of regulation allows for more of a market-based pricing model, albeit a bit more brutal on seniors.

Comment by OneAgainstMany
2017-12-03 21:44:32

Price discrimination is a fraught concept. At what level do we allow insurers to insure at a granular risk level? There is room for a healthy debate here. If you a smoker you can get charged more. What about if you have a BMI that is above 25, should you get charged more? What about DNA testing and zip codes (poverty correlates to poor health)? What about racial predispositions to certain diseases or familial history of chronic disease or mental illness? The basis of health insurance is pooled risk, or socialized risk. Even these high risk pools that Cruz is talking about eventually lead to the government insuring the high risk, which is taxpayer money, which means essentially the same thing as guaranteed issue, but in a different form. There is some small percentage of the population that will have exorbitant medical costs that they will not be able to pay for. Everyone else in an insurance pool pays to cover this.

Comment by rms
2017-12-03 21:54:28

“Guaranteed issue and community rating are concepts…”

The lack of incentive to take of yourself doesn’t inspire confidence.

Comment by Carl Morris
2017-12-04 11:23:41

Why should a younger healthy person pay the same insurance premiums at work as an upper forties obese smoker? Where’s the competitive free market?

Do we want to pool risk or not? If not then we don’t need insurance. I think there is no “in between”…we have to choose one or the other. The only hybrid option I can imagine is that government pools catastrophic risk for the entire population, and all the normal health care costs are paid in cash.

Comment by OneAgainstMany
2017-12-04 17:55:37

Do we want to pool risk or not? If not then we don’t need insurance. I think there is no “in between”…we have to choose one or the other.

One large problem often overlooked is that insurance is the mechanism by which most healthcare expenditures are paid for and it applies to routine health care and not merely catastrophic situations. I have mixed feelings here. On the one hand, I kind of understand why people would want to select a plan that excludes benefits for which they are unlikely to use (i.e. maternity care, birth control, mental illness and addiction treatment). On the other hand this, this would create a death spiral where people opt out and the costs would sky rocket for this subset, effectively eliminating the pooling of risk. I think you have to look at factors and be able to price discriminate and charge some premium for high utilizers in order to strike some happy medium (e.g., BMI, # of meds prescribed, age, smoker, # of hospitalizations, etc.)

Comment by Carl Morris
2017-12-04 18:14:52

One large problem often overlooked is that insurance is the mechanism by which most healthcare expenditures are paid for and it applies to routine health care and not merely catastrophic situations.

I don’t think I’m overlooking that. I just don’t think it’s needed. If we go to a single payer utility then everything that is provided is covered with no further effort required on the part of the patient. If we go all cash then it functions exactly like you would expect…the mechanism is the customer’s Visa card at the counter prior to service being provided, just like China. If we go with the hybrid I outlined it’s one of the two above depending on which category the service falls into.

Why does insurance need to be involved in routine health care? It’s only when insurance is in the middle of things that a death spiral can occur.

Comment by OneAgainstMany
2017-12-04 21:55:32

You make good points, and I would largely agree with you on many things.

Comment by SFMF
2017-12-02 15:00:26

The mandate repeal is a bigger nothing burger than the Flynn news.

First off, the only way a mandate penalty can be collected is from a refund. So the simple way to avoid it; don’t overpay taxes. Which is good advice nonetheless, never give the IRS an interest free loan for a year.

Second, Trump already signed an EO that basically told the IRS not to enforce the mandate.

So basically nobody is affected by the mandate. Repealing it might have been a nice symbolic move, but nothing will change.

And yes the core problems of Obamacare have not been addressed. The real problem with it is the insane “essential benefits” that every policy has to have. Are you a 52 year old post-menopausal woman? Good news. Your health insurance covers birth control, maternity and abortion services!! Oh what’s that? You don’t want to pay for those things since there is literally 100% chance you will never need that kind of medical care? Too bad. You will pay for it.

What’s that? You’re generally healthy single man who has never touched drugs, and just want a cheap catastrophic insurance if you get hit by a bus? Tough. You will pay for routine check ups and maternity coverage and drug rehab, whether you want it or not.

That is Obamacare.

Comment by OneAgainstMany
2017-12-02 18:36:44

Essential benefits are a red herring. You’re going to have go a lot deeper. Fee for service vs. fee for quality/outcome/value is a much bigger. Insurance companies adding huge layers of administrative bloat. The high salaries of medical providers in US vs other industrialized nations. The pharmaceutical industry lobby to keep prescription meds sky high and preventing competition.

The biggest issue cost driver is America’s general poor health.

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Comment by OneAgainstMany
2017-12-02 18:39:36

Also, the US needs more mid-level practitioners (physician assistants and nurse practitioners) and licensing needs to change so their scope of practice can increase and they can handle more routine general practice care.

Comment by Taxpayers
2017-12-03 10:45:52

++ deregulation for lower cost
Same for airline history n uber

Comment by OneAgainstMany
2017-12-03 17:29:26

Because healthcare is just like commercial air travel and taxis? The data shows that the countries with the strongest regulation have the most affordable care. Without some strong regulation you’re going to have orthopedists doing repeat knee surgeries on morbidly obese patients at $150k a pop and billing medicare/medicade. No, deregulation doesn’t work in our system.

Comment by OneAgainstMany
2017-12-03 18:05:14

Now, if we want to talk about transparency in pricing and cost-sharing, then we might be able to talk about measures that will reduce over-utilization and enhance price competitiveness. Clinicians need to be able to easily convey the cost of care to their patients, regardless of their payment and reimbursement system. Patients who utilize more need to have their premiums increased and cost-sharing measures need to be thoughtfully implemented.

Comment by SFMF
2017-12-02 14:52:17

- every day since 2015

Comment by Professor 🐻
2017-12-02 07:10:00

“The ‘China is taking over the world’ meme is a perennial one. As usual, this argument overlooks what’s happening within China’s borders. That includes: a credit-driven growth model that has left debt growing faster than the economy, the continued dominance of inefficient state-owned enterprises (SOEs) at the expense of dynamic private firms, and a fiscal system that depends on a housing bubble to sustain it.”

Could anyone who understands how China’s fiscal system depends on the housing bubble to sustain it please elaborate?

I am wondering if things work similarly inside of The People’s Republic of California?

Comment by Prodigal Son
2017-12-02 08:48:55

Here’s a brief summary from what I’ve picked up over the years:

- Developers buy land from local governments using their crony connections.
- The local government loans the developer the money to buy the land.
- The local government uses the “profits” from the sale to make high interest loans to businesses, assuming the national government will reimburse them if those investments go bad ( which they will).
- Businesses use those loans to make loans to other businesses.
- The financial ties are so intertwined that even the government can’t sort it out, which is why insolvent companies aren’t allowed to default.
- It’s only a question of when the whole house of cards collapses.

And those are just the issues we know about.

Comment by Professor 🐻
2017-12-02 08:51:21

Sounds corrupt as hell.

Comment by Mr. Banker
2017-12-02 09:09:47

I like it.

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Comment by Prodigal Son
2017-12-02 09:25:47

David Stockman calls China the Red Ponzi, which is a pretty accurate description of China’s economy.

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Comment by 2banana
2017-12-02 09:00:19

Wait - are we talking California and NYC?

Comment by MacBeth
2017-12-02 10:19:48

Good write-up prodigal.

Liars includes many people, in addition to Realtors.

This board needs to work harder at being inclusive - in recognizing other liars as well. Realtors are mere piffle in this game.

The entire real estate industry needs to be exposed and dealt with, much like the media is today.

Comment by BlackSwandive
2017-12-02 10:38:14

“- Developers buy land from local governments using their crony connections.”

This is the most important first step to a land bubble, and subsequent housing bubble - restrict access to land by end users, creating an artificial supply shortage, which also concentrates windfall profits to the moneyed special interests. The big money controls everything in this country.

Comment by MacBeth
2017-12-02 11:00:20

“The big money controls everything in this country.”

Yes, it does. And it needs to stop. Right now seems just as good a time as any.

It appears we have a president at least somewhat interested in the pursuit. Time will tell the extent to which he is committed to liberty for all individuals.

The results to date are mixed - which is one hell of an improvement to what we’ve had during the past 30 years.

Down with the NeoCon-Progressive Party. Drain that swamp.

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Comment by trader jack
2017-12-02 13:59:18

I don’t agree with that!

No local government seems to own the land in this area of California.

they control it, but do not own it

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Comment by BlackSwandive
2017-12-02 17:48:04

I’m talking the initial sale, trader jack, not subsequent sales. All land was initially government owned, unless it was homesteaded back in the olden days.

Comment by CorporateShill
2017-12-02 21:10:41

See Marin County. They took tax dollars and bought the land thus driving costs to the stratosphere. This is one example among many.

Comment by Professor 🐻
2017-12-02 07:12:13

“As the various bills under consideration propose, the deduction should be pruned or eliminated—not just because it is inequitable but also because it distorts the housing market.”

Which bill proposes to eliminate the MID?

Comment by 2banana
2017-12-02 07:12:56

Fake news

Fake wealth in housing

Fake stocks and fake companies

Fake wealth in crypto currencies

One day soon it is going to end…


Carmageddon for Tesla
Wolf Richter • Dec 1, 2017

Tesla isn’t quite out there by itself, though. The Wall Street hype machine backs it up, dousing it with billions of dollars on a regular basis to burn through as fast as it can. This masterful hype has created a giant market capitalization of about $52 billion, more than most automakers, including Ford ($50 billion). It’s not far behind GM ($61 billion).

But Tesla – which lost $619 million in Q3 – delivered only 3,590 vehicles in November in the US, down 18% from a year ago.

3,590 vehicles amounts to a market share of only 0.26%, of the 1,393,010 new cars and trucks sold in the US in November. Porsche outsold Tesla by 55% (5,555 new vehicles).

So how are Model 3 sales doing? Since Tesla doesn’t disclose its monthly deliveries in the US, the industry is guessing. The assembly line still isn’t working. “Manufacturing bottlenecks,” as Tesla calls it, and “manufacturing hell,” as Elon Musk calls it, rule the day.

Our Model 3 program is on track to start limited vehicle production in July and to steadily ramp production to exceed 5,000 vehicles per week at some point in the fourth quarter and 10,000 vehicles per week at some point in 2018.

November is solidly in the fourth quarter. 5,000 vehicles per week would mean over 20,000 a month. OK, this is November and not December, so maybe 4,000 a week for a total of 16,000. We got 345.

Comment by In Colorado
2017-12-02 08:56:53

Chevy is already selling over two thousand Chevy Bolts per month. Other makes will soon be joining them. And unlike Tesla, other automakers know how to run assembly lines.

Yet more good money will be thrown into the Tesla black hole.

Comment by MacBeth
2017-12-02 09:43:06

I will never buy any product from Elon Musk. The guy’s an @ss.

Additionally, I resent public adulation for tech geeks who are clueless about nearly all things business save taxpayer-funded government backing.

I am tired of government picking winners and losers.

Comment by In Colorado
2017-12-02 11:42:50

Unless Musk can right his ship, Tesla will run out of cash early next year. I have no doubt he will get more investment from suckers. Meanwhile Ford, GM, VW, Toyota, Nissan and others will become established electrical car providers and own lion’s share of the market.

Tesla is blowing its head start and if it can’t solve its manufacturing problems (word is that they have to build the Model 3’s by hand because their assembly lines don’t work) it will get left in the dust.

Musk seriously underestimated just how hard it is to mass produce cars and his wunderkinds can’t seem to do it.

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Comment by MacBeth
2017-12-02 12:22:59

Telsa is blowing its head start because Musk is an @ss.

Some humility, and some knowledge of business aside from swindling taxpayers via government larceny, might help.

Comment by MacBeth
2017-12-02 12:28:05

“Musk seriously underestimated just how hard it is to mass produce cars and his wunderkinds can’t seem to do it.”

Could be that he’s really as smart as he thinks he is.

A majority of tech people everywhere make that same mistake. And they make it often.

Comment by MacBeth
2017-12-02 12:30:07

Correction: That he’s NOT as smart as he thinks he is.

Comment by butters
2017-12-02 14:54:32

Tesla’s future is as cultist car manufacturer. Nothing more.

Comment by Taxpayers
2017-12-02 13:57:36

10_4 ,w/o mucho nukes built stat e cars r a pipedream

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Comment by redmondjp
2017-12-03 00:16:44

I concur with Tesla running out of cash soon. I’ve worked for several manufacturing companies, ranging from a GM parts division with 30K employes (fun fact: GM purposefully omitted the second ‘e’ in ‘employee’, as some bean-counter way back when decided it would save them some money) to small companies with only 30 people.

At one company, we practiced open-book management. The entire production line shut down once per quarter and everybody was bused to an auditorium where our CFO gave us the balance sheet rundown. Every single person at the company knew what their job was and how it related to that balance sheet (and they were proud of that, rightfully so).

It gave me a whole new perspective on cash and the importance of controlling cashflow. Because of this knowledge, I don’t have much hope for Tesla. When you run out of cash (no matter what your book value is, your stock price is, how much inventory you have sitting out in the parking lot, how much your real estate is worth, etc.), the employees, suppliers, and utility bills don’t get paid, and the doors close.

It really is that simple.

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Comment by BlackSwandive
2017-12-03 10:52:33

The only thing keeping them alive is a stock market bubble and Yellenbucks. I have no doubt they will just sell more junk bonds to salivating investors to raise more cash.

In my opinion, a likely scenario is a bankruptcy where another auto manufacturer picks up their assets on the cheap, to expand their own electric vehicle line.

Comment by oxide
2017-12-02 18:28:56

Everybody — from Elon Musk on down — is going at this from the wrong angle. If the government is going to pick winners, it needs to be funding for standardizing the battery recharge. Once that is figured out, give boucoup bucks to gas station owners who invest in installing recharging stations, especially gas stations in the sticks.

A few virtue-signaling charging stations at the natural food store is NOT going to cut it.

Comment by BlackSwandive
2017-12-02 14:08:14

Until the Yellenbucks dry up, look for Tesla to continue with their junk bond shenanigans. They should be finished already given their lack of profits and cash burn, but Wall St. continues to bestow billions and billions upon them.

Nevermind the financials, Tesla’s production and delivery thus far is a sick joke, just pitiful. Yet, if you breathe one word of negativity about Tesla on any financial forum, you’re met with vitriol and hatred. There’s little doubt it’s because a lot of people have gone all in on their stock, but I’m starting to think that Tesla has paid online trolls.

Comment by OneAgainstMany
2017-12-02 18:52:59

Tesla is has a fairly high short interest, 24% last I checked. Many investors have a vested interest in seeing the experiment implode, so it’s rare to see a neutral party. I routinely see more Tesla skeptics than true-believers. The true believers are the end-users, those on the other side (from what I’ve observed) seem to have an axe to grind with anyone remotely associated with the environmental movement. It’s a tribalism thing. All I know is that I’ve driven in my father’s Model S 100D and it was way better than any of his other cars (Audi, Mercedes, Landrover, etc.).

I’m a Tesla fan, so I suppose that makes me a minority here. But that is because I want EVs to be affordable and mainstream, and I would pay $35k to do it (without EV subsidy). Chevy Bolts numbers are looking really good though, so Mary Barra is doing something right. Her self-driving Bolt fleet is starting to look pretty good right now.

Comment by Ben Jones
2017-12-02 07:25:32

‘The ‘China is taking over the world’ meme is a perennial one’

I’ve noted this before. Their “leader” (unelected of course) is always shown in a very positive light. Expensive suits, red carpets, projecting total power. That’s probably why the globalist media admires China so much. Notice how they marvel at their “command economy”, obviously wishing it was universal. Meanwhile people there can hardly breath the air.

Comment by Professor 🐻
2017-12-02 07:31:16

Not only is it hard to breath, but the benefits of constructing entire cities of empty towers remains to be seen. I predict that looking back in a couple of decades with the advantage of hindsight will make clear that much of China’s miraculous economic growth amounted to pouring good money down a rathole of unrepayable debt.

Comment by butters
2017-12-02 14:20:37

The government and oligarchs in US wish US was China also. More control for them. TBH, are we that far off? Except for the political ‘freedom’, which doesn’t amount to much change anyway.

Comment by SFMF
2017-12-02 15:08:44

Democrats Monday: Isn’t it awful how hard working men and women with no rights are exploited by powerful interests?

Democrats Tuesday: Isn’t China awesome?

Comment by alphonso bedoya
2017-12-03 11:01:40

China needs drinking water. Their snow surplus in the mountains to the North is disappearing through evaporation. Their bitcoin operation in Mongolia expends energy beyond any sustainable level. Their air pollution arising from coal is documented.
The aforementioned makes for an interesting future. N’est pas?

Comment by Professor 🐻
2017-12-03 15:00:22

“Their bitcoin operation in Mongolia expends energy beyond any sustainable level.”

Dumbest waste of energy on hyping a mania ever?

Comment by Professor 🐻
2017-12-02 07:26:10

‘The current tax code favors people who are buying a home versus the rest of America,’ he said. ‘As a captain of industry, I would prefer more tax breaks to help people buy houses, but as a citizen, I realize someone has to pay.’”

Why not end communistic housing market policy in America by letting each household pay for the home they choose to live in on their own dime? Why should poor renters have to subsidize millionaire home purchases through the MID, capital gains tax breaks, or federal loan guarantees? None of these policies make sense from a fairness standpoint. They are all welfare policies for the wealthy, wrapped up in patriotic propaganda. They mainly benefit coastal elitists who view their housing market riches as manna from heaven and a God-given right, somehow ignoring that our market distorting federal housing policy is behind it all.

Comment by junior_kai
2017-12-02 08:53:54

Same reason virtually all the (((leftist))) hellhole city leaders insist on building stadiums and gifting them to the billionaire team owners - they’re bought and paid for by those same billionaires.

I think we should end all write offs, period. Get the tax code down to 10-20 pages. No way to have loop holes when the thing is dead simple.

Comment by In Colorado
2017-12-02 11:45:38


Aren’t most leftist hellhole city leaders black, Hispanic or some other “brown” minority and not members of “the tribe”?

Comment by GreenEggsAndSpam
2017-12-02 14:36:28

When the demographics require it, (((they))) get a token or facade candidate, otherwise they maintain direct control as in Chicago or New York. The tokens are uniquely qualified based on their ability to follow orders - Ozero being a prime example. The tokens dont have the IQ to attain power on their own, or if they somehow do they dont have enough of a network of supporters with the IQ and resources to elect them without support of the tribe. Figured this out 2 decades ago when I lived in San Diego and saw how LA politics worked - from the school boards to the mayor of LA, theres no mistaking who runs that city. Eventually the demographics tip but they still maintain control so their criminal operations remain unimpeded.

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Comment by GreenEggsAndSpam
2017-12-02 15:44:00

Good example: the RFK schools in LA, which cost $578 MILLION to build and hosts about 4K students:

Who built it, and who oversaw costs on the govt side? You know (((who))).
More info:
Each pilot school has a social justice mission.
Imagine my shocked face
In 2010, two lawsuits were filed, alleging molestation of two children at New Open World Academy, one of the small schools at RFK that opened in 2009.
Its who they are; its what they do.

A more specific example which you cannot find on the internet as it happened pre-WWW and probably everything since has been scrubbed:
(((Irwin Jacobs))), founder of Qualcomm, was a professor at UC San Diego when he developed CDMA technology. All property developed in the employ of University of California belongs to UC. When cell phones took off, he paid off the chancellor of the school (((Richard Atkinson))) what amounted to a quarter billion dollars in stock and voila! Atkinson ruled there were no rules in place at the time CDMA was developed and as such the patents were not UC property. Because thats what friends do right? Of course everyone who worked for the UC at the time (including *cough* your humble writer) knew differently. Both have since tried to atone for their crimes by donating some of their ill gotten gains towards the symphony and various hospitals - a move you see time and time again by the tribe and other mafia types.

Last one - John Moores (family history is predictable), owner of the San Diego Padres had a software company pre dot com bubble that made software for industrial controllers - a friend worked there. Moores hypes up the company, building huge buildings and causing the stock price to go to the moon on absolutely nothing. He deftly gets out a billion or two before the stock and company crater, buys the padres - and the local politicians (one of which went to jail for taking his bribe!) - to get a new stadium built for him, gifting him the surrounding land for development in the process. Same deal, gives money to the symphony and various hospitals, ends up on the UC board of regents which is really just a collection of (((criminals))), Senator Feinswines husband is on it as well.

Their criminality is wildly out of proportion to their numbers in the population.

Comment by Professor 🐻
2017-12-02 18:15:18

Thanks for the great anecdotes, GreenEggs.

Comment by Drater
2017-12-03 10:37:00

GreenEggs thinks using “((( )))” doesn’t make him anti-semetic

Comment by GreenEggsAndSpam
2017-12-03 16:11:34

Pointing out a myriad of crimes committed by the same group of (((parasites))) is anti semitic? Good to know!

As a refresher, from (((their))) own newspaper, albeit an incomplete list:

Hard to grasp for people who 1) have poor memories, 2) suck at math, and 3) have no observational skills.

Comment by MacBeth
2017-12-02 12:18:30

There should be ZERO deductions and write-offs. Period.

Comment by butters
2017-12-02 14:41:57


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Comment by palmetto
2017-12-02 18:39:48

jeez, Prof, big ups to that comment. Says it all.

Comment by Professor 🐻
2017-12-03 15:07:11

When I was a kid, low income housing policy involved building high-rise hell holes like Pruitt Igo and Cabrini Green, then packing in destitute families and hoping for the best. At some point (CRA passage), the policy evolved into discriminatory subprime lending to low-income families of color, in the hopes that such redistribution of wealth would make society better off.

Comment by Professor 🐻
2017-12-03 16:07:27

This stealth redistribution policy has turned U.S. housing markets into overpriced disfunctional clusterforks. Handing out federally guaranteed mortgages to low income buyers who qualify for loans on a dicriminatory underwriting standard has put many low income families on track for future foreclosure and financial bankruptcy. And it has priced traditional middle class buyers in the blue states. All in the name of making homes affordable.

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Comment by Professor 🐻
2017-12-03 16:08:52

Priced out

Comment by 2banana
2017-12-02 08:02:25

No one noticed a 3M gallon “leak” PER DAY for over 20 YEARS…

It is government. It is not like it is their money.


Galveston water line leaked 3M gallons daily for years
AP - 12/2/2017

Galveston city workers have discovered a leak in a nearby water line that had been pouring an average of 3 million gallons of water into the city’s storm sewer system each day for years.

The Galveston County Daily News reports that city workers found the leak Nov. 18 while trying to set up new back-flow prevention devices that could potentially delay the effects of sea level rise.

City Manager Brian Maxwell says workers capped the line to stop the flow. Maxwell says the 10-inch line was supposedly abandoned by Galveston in the mid-1900s and doesn’t appear on any recent city maps.

Maxwell believes the leak occurred for at least seven years. Assistant City Manager Brandon Cook says the city’s had to buy 3 million gallons less water a day since capping the line.

Comment by 2banana
2017-12-02 08:47:27

Just doing some math here:

Galveston has about 50,000 people. Average consumption per person in US is 80-100 gallons per day.

Leak of 3MM gallons per day for 50,000 people is 60 gallons per person per day.

Not one city workered said “Hmmmmm….why do we use almost 100% more water than the average city our size? Hey, look at that! Time for lunch.”

Friends in Texas pay $40/month of 3,000 gallons. That equates to $40,000/day for Galveston or $1.2 million a month.

Or $288 million over 20 years.

Take off 50% as the city probably gets a big discount from retail.

$150 million. Not counting interest. Wasted.

Not ONE city worker could have figured that out…well, it’s not their money. Hey, look at that - lunch time!

Comment by junior_kai
2017-12-02 08:57:47

I just read my countys payments to its pension will double in the next 4 years. They’ve known about this problem for years and now its going to come to a head. Couple this with a housing downturn and it should get interesting. I’m thinking I will have to be very sensitive to property taxes if I choose to buy here in the next downturn, because they will likely NOT be assessing down - and I may choose to go to greener pastures.

Comment by Ol'Bubba
2017-12-02 10:24:39

Where are you located, junior?

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Comment by BlackSwandive
2017-12-02 11:16:07

Not only have pretty much all counties in the US “known about this problem,” they’ve continued to promise more and more and more, and hire more and more and more, exacerbating it. Meanwhile, property taxes are exploding, as well as new “fees” everywhere you turn. Fees don’t have to be approved by taxpayers, they’re the latest screw job by local and state governments.

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Comment by In Colorado
2017-12-02 11:48:40

.gov employees in the Centennial State are grumbling because they are being told that THEY will have to contribute more to their pension funds, instead of having taxpayers pick up the tab.

Oh the humanity.

Comment by Taxpayers
2017-12-02 14:02:17

Consider counties w average age over 42= no kids in schools,the #1 expense

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Comment by rms
2017-12-02 14:05:49

That’s roughly 4.65-cfs.

Comment by 2banana
2017-12-02 08:06:50

Blue state housing is about to get CRUSHED.


In Major Victory For Trump, Senate Passes Tax-Cut Bill Which Nobody Read: Here’s What’s In It
ZeroHedge - 12/2/2017

STATE AND LOCAL PROPERTY TAXES: Collins has proposed an amendment that would retain a federal deduction for up to $10,000 in state and local property taxes.

Comment by Professor 🐻
2017-12-02 08:49:07

The peculiar idea that owning a house is a guaranteed path to riches will soon be seen as an absurdity, once the folks who are caught up in the mania finally take off their beer goggles.

Comment by da bear
2017-12-02 14:27:49

“They aren’t making any more, uh, Bitcoin!” — Christmas parties

da bear

Comment by MacBeth
2017-12-02 09:38:50

Sorry to burst your bubble, 2 banana, but it won’t get crushed.

There may be some decline, but the loss of the SALT tax deductions above $500K won’t amount to much to coastal elitists.

What it does do is signal to these coastal leeches that everyone else is sick of their sh@t.

They are rapidly and increasingly discovering that they DO NOT know better than everyone else. Simultaneously, they are discovering that the rest of the country is not simply going to do whatever the hell the elitists want.

It doesn’t work that way. We’re not Europe.

Comment by GreenEggsAndSpam
2017-12-02 14:44:56

Crush is a fuzzy term, but on a relative basis I think the blue states are in for a pretty good beating, as I have a ground level view in one of the deepest blue states out there. A perfect storm (its name was . . . Donald) of an inevitable decline in a frothy market, an elimination of SALT (will kill off a lot of future demand) and the biggest elephant in the room, out of control welfare spending and pension obligations in the brain dead blue states will feel like Kamala the Ugandan Giant just leaped off the top rope onto your sorry azz. This is going to cause a lot of people to open their eyes and either leave those states or vote these dumb SOBs out and restore some fiscal sanity.

Its 4D mf-ing chess, yo.

Comment by GreenEggsAndSpam
2017-12-03 16:03:57

Just heard Bob Brinker predict the same, and brought up a point I hadnt thought about - blue states are going to have a much tougher time going forward issuing all of their muni debt - paying off current bonds will get more difficult. Cali, NY, Illinois and probably a few others issue bonds in the 100s of Millions like they were candy to keep their ponzis going. Essential services will be cut to the bone and it will be tough on people - likely govt leeches and other parasites. Perhaps once the states have imploded and purged themselves of the scum Trump will come in and get something passed allowing for states to go bankrupt and those states can go back to the normal they enjoyed 30-40 years ago.

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Comment by butters
2017-12-02 14:15:25

I hate hyperbole’s. Nothing got crushed at all.

Comment by SFMF
2017-12-02 15:14:43


People on the coasts will pay a bit more in taxes. But the $1M home in CT isn’t going to suddenly cost $300K because of this. And if you can swing a $1M+ mortgage, an extra few $K in taxes annually isn’t changing anyone’s lifestyle.

Comment by Mafia Blocks
2017-12-02 16:21:12

The million dollar shack in CT can and will very likely go to $300k and lower.

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Comment by redmondjp
2017-12-03 00:27:55

Oh give it up, HA . . .

Comment by oxide
2017-12-02 18:45:52

MID is grandfathered for everybody, and new buyers only need to worry about $500K or above. Even then, doubling the standard deduction will cover most of the lost MID anyway.

So, NY and CA will feel an effect, as will the liberal expensive beach houses. But I don’t see a lot of crushing.

Comment by Professor 🐻
2017-12-02 19:35:54

Crushing comes when current owners, who have the MID, try to sell to new prospective owners, who have not.

Comment by oxide
2017-12-03 13:20:50

What part of $500k don’t you understand?

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Comment by Professor 🐻
2017-12-03 08:39:33

“Even then, doubling the standard deduction will cover most of the lost MID anyway.”

You seem to have missed the main point, which is that one of the best reasons Realtors give to own rather than rent goes away if taking the standard deduction beats itemizing to claim the MID. This could be a serious purchase demand killer in high cost markets like DC.

Comment by BlackSwandive
2017-12-03 10:56:05

From that aspect I love it. Nothing like stealing one of the REALTWHORES’ canned responses.

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Comment by miami33
2017-12-02 08:33:29

Realtors Predict Tax Bill Will Cause Housing Prices To Drop In Every State

“…According to the NAR, homeowners in New Jersey, Connecticut, Illinois, New Hampshire, Maryland, Rhode Island, Virginia, Wisconsin, Georgia, Minnesota, New York, Ohio, Pennsylvania, and Texas (in order of sharpest decline with New Jersey most impacted) would see the sharpest dives. Estimated drops range from 10% on the low end to 21% at the high end.

The least impacted homeowners would be those in New Mexico, Arkansas, Louisiana, Mississippi, South Dakota, Tennessee, Hawaii, North Dakota, Wyoming, and West Virginia (highest to lowest, with West Virginia being least impacted). Estimated drops range from 5% on the low end to 10% at the high end….”

Comment by 2banana
2017-12-02 08:55:04

I don’t get the list.

Hawaii has extremely high housing prices (thus high mortgages) and has state income tax of up to 11%. They are going to get CRUSHED.

Pennsylvania (outside a few wealth Philly suburbs) has fairly low property taxes and a 3% flat tax. Most folks will probably fall under the $10,000 if they itemize at ALL (since the standard deduction is DOUBLING).

Texas being HIT hardest? They have higher property taxes than other red states (but nothing like deep blue states) and NO INCOME TAX. Again, the will probably fall under the $10,000.

Same for Georgia.

Bottom line. If you live in a long term democrat controlled state with public unions - you are going to get crushed.

Comment by Lurker
2017-12-02 14:57:43

Meanwhile Fannie and Freddie just announced a 6.8% increase in the 2018 conforming loan limits for high-cost (ie blue state) markets to $679,650 (and up from there for Hawaii). Borrow more AND pay more in taxes, what fun!

Comment by Rental Watch
2017-12-02 15:06:21

Last year, the FHA announced their increase in early December…that may be coming too.

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Comment by butters
2017-12-02 15:20:48

Sub-primes galore.

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Comment by Mafia Blocks
2017-12-02 17:24:10

Yep. And according to the article 2006 was the last time it was raised, precipitating the collapse.


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Comment by redmondjp
2017-12-03 00:30:13

Crushed in HI? Chinese seeking to expatriate their yuan/dollars won’t care a bit about paying a bit more.

Comment by Mafia Blocks
2017-12-03 06:16:53

Good point on Hawaii where entire zip codes are 100% ARM’s and Asians using subprime mortgages.

Waialua, Hawaii Housing Prices Crater 14% YOY

Comment by Professor 🐻
2017-12-02 08:56:13

Do they also predict 🐕s mating with 🐈s in every state?

Comment by Mafia Blocks
2017-12-02 12:49:56

Good for realtors. Good for all.

Remember….. Nothing accelerates the economy and creates jobs like falling prices to dramatically lower and more affordable levels. Nothing.

Warrenton, OR Housing Prices Crater 23% YOY

Select price from dropdown menu on first chart

Comment by 2banana
2017-12-02 09:08:33


As a guerilla fighter to Mr. Banker.

I have refinanced my house a few times to get a lower interest rate. But I never took a “cash out” option even thought these were pushed very hard by the bank.

Not one Home Equity Loan either.

I just paid the mortgage down every month with, usually, a nice extra chuck of cash. And happily took the interest deduction in my taxes.

After awhile, you start to pay much less in interest. Soon, the interest (and interest deduction) really isn’t that much anymore.

So - if the Trump tax bill becomes law, I am paying off my mortgage in FULL.

I wonder how many others will do the same?

Comment by Mr. Banker
2017-12-02 10:15:41

“I wonder how many others will do the same?”

Bahahahahahahahahaha … not enough to make all that much of a difference.

Comment by MacBeth
2017-12-02 10:28:43

I’m perplexed by the lack of discussion here re: Visegrad Alliance. (I know that this is a housing board, but we cover lots of ground here, why not this?)

Hopefully, Austria will soon join them, making it V5 rather than V4. Hats off to Poland, Czech Republic, Slovakia and Hungary.

Perhaps The Netherlands will follow suit in coming years?

Trump should be talking up Visegrad on occasion. Americans everywhere need to know - or need to be reminded - that they are not alone in the fight against globalism and one-world government. It’s not just Brexit and Trump.

Though are a year old, get a load of the commentary on the video below. And the countries represented. Wow!

Comment by palmetto
2017-12-02 11:05:26

Thanks for bringing this to my attention, Mac. It really wasn’t on my radar as an alliance, although I was aware of what Poland and Hungary were doing individually.

Comment by MacBeth
2017-12-02 11:59:13

Most definitely an alliance. Central Europe is very much on the move toward nationalism and away from globalism.

(Another example of the big things afoot, as you’ve noted several times recently. Yeah, Saudi Arabia is a big thing afoot, too. Remarkable events are taking place, with what could be long-term ramifications).

I just posted another video re: Poland. Be sure to watch it.

There’s a similar one re: Austria, but I am unable to locate. Austria’s new leader Sebastian Kurz is very anti-global as well.

Here’s a great interview with Kurz, from der Speigel. Kurz handles himself very well. His attitudes are solid. Good for Austria!

Comment by MacBeth
2017-12-02 11:33:45

Just saw this for the first time 10 minutes ago.

If only we had the devotion to self determination that the Polish do. May they succeed in leading Europe away from global tyranny.

Peaceful and resolute. What a video! Starts slowly, continues to build.

Comment by Taxpayers
2017-12-02 14:11:06

Poland almost disappeared twice

Comment by Carl Morris
2017-12-04 11:42:18

Poland almost disappeared twice

Completely disappeared on paper. Yeah, they’ve had some bad experiences and there are still people alive who remember.

As someone whose roots come from within walking distance of the tri-border point of PL/CZ/SL I’m interested to watch this.

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Comment by palmetto
2017-12-02 18:23:35

Thanks again, Mac. A free, confident and proud people, united. Compare to the conquered of the US.

Comment by In Colorado
2017-12-02 12:29:59

I doubt the Austrians will join them. For one thing Austria is much wealthier than Poland, Hungary, Slovakia or the Czechs. And unlike them , Austria has been more than happy to accept rapefugees and to shower them with free cheese.

Austria does appear to be changing its tune, but I think they have a ways to go before turning their backs on the EU.

Comment by Apartment 401
2017-12-02 12:06:15

Living in cars and working for Amazon:

Jeff Bezos is now worth over a hundred billion dollars.

Comment by MacBeth
2017-12-02 12:39:00

I read that article about 2 weeks ago. It’s a great piece.

Here’s another. It’s about how self-driving trucks may decimate a very significant part of the economy. EVERYONE’S economy, not just truckers.

Some hair-raising food for thought, even if it proves only half true one day. It’s worth taking the time to read the entire article.

I read it. Twice. And I’ve put a hard copy of it in my investment files.

Comment by BlackSwandive
2017-12-02 17:53:23

“Federal minimum wage is stalled at $7.25 an hour.”

Can you imagine working for $7.25 per hour?

Comment by jeff
2017-12-02 17:59:56

“Since 2009, the year after the housing crash, groups of such workers had migrated each fall to the mobile home parks surrounding Fernley. Most had traveled hundreds of miles”

Wasn’t there somebody here yesterday that said he had been following this blog for a year waiting for “the housing crash”?

Comment by redmondjp
2017-12-03 00:36:03

They just built an Amazon delivery warehouse on my lunchtime walking route. Now, every day, there is a line of 50-75 private vehicles snaking all the way around the building, to the entrance, where they drive through and are loaded with their deliveries.

There was just an article about one of these drivers who was caught stealing a package (delivered by UPS earlier the same day) from a porch to which he had just delivered an Amazon package. Fortunately the house had good security cameras which caught it all.

What a hoot - our new ‘gig’ economy - the delivery drivers get nothing but a pittance, while Jeff Bezos has more money than God, and makes the robber barons of a century ago look like Robin Hood in comparison.

Comment by Professor 🐻
2017-12-02 12:07:23

Who knew the Democratic hell hole in Sacramento was crawling with rapists in high office? I guess the Pelosi family, for one…

‘We Have Rapists Here In This Building’ — California Legislators Hear Horror Stories Of Broken Harassment Reporting System
November 29, 2017 7:40 PM

SACRAMENTO (CBS13) — “We have a whisper network you all know it. Because what everybody here knows is we have rapists here in this building. We have molesters among us,” said Christine Pelosi.

The head of the California Democratic Party’s Women’s Caucus says no one knows about those alleged abusers, because of a deficient system for reporting harassment.

“Isn’t that problematic,” said Vince Fong.

The problem, Assemblyman Vince Fong says, is the Capitol’s human resources department doesn’t record complaints of harassment involving current lawmakers.

Human resources administrators confirmed cases of misconduct are kept secret.

“Those records may have existed they don’t exist,” said one administrator.

Comment by butters
2017-12-02 14:08:40

Isn’t her mom one of the enablers in Congress? How many she knew and why she kept quiet?

Comment by GreenEggsAndSpam
2017-12-03 15:57:48

How DARE you talk about ICONS like that, lol!

Dems main leaders in the last 40 years have been:

Ted Kennedy - killed a woman
Bill Clinton - raped women

Trying to pretend they back women is hilarious.

Comment by rms
2017-12-03 17:03:45

I wish SNL would create a skit on Slick prepping a cigar.

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Comment by Carl Morris
2017-12-04 11:47:26

One of the best SNL skits ever was from the 2008 time period and it was John Goodman playing Moses delivering the ten commandments and Darryl Hammond(?) as Bill Clinton in the crowd asking lawerly questions about them. It has been completely scrubbed from the internet. What you are suggesting wouldn’t exist for long.

Comment by goedeck
2017-12-02 21:09:33

Why do these things come and go? Renember when all your friends were dumping ice water on their heads?

Comment by BlueSkye ⚓
2017-12-02 13:39:52

From the Canada article

“those renewing their mortgages who have never missed a payment, but won’t be able to qualify under the 200-bps stress test…so they can charge 20 bps, 30 bps more on customers who have nowhere to go”

How ironic. If the bank determines that you would be strained by an interest rate increase…they will raise your interest rate!

Comment by Mr. Banker
2017-12-02 14:30:56

“How ironic. If the bank determines that you would be strained by an interest rate increase…they will raise your interest rate!”


Comment by BlackSwandive
2017-12-02 14:23:30

Within my junk mail today was a credit card offer from my bank. I usually just tear them up but I opened it. 0% for the first 18 billing cycles, then a VARIABLE 13.99% - 20% APR depending upon what you qualify for.

I don’t have any credit cards, but what kind of mental midget would be paying such massive interest? This blows my mind.

Comment by butters
2017-12-02 14:31:41

Desperate people. Don’t forget this country is full of them…living paycheck to paycheck.

Comment by Mr. Banker
2017-12-02 14:32:22

“… what kind of mental midget would be paying such massive interest? This blows my mind.”

This a joke, right?

Comment by Anonymous
2017-12-03 13:42:13

I use my CCs to buy almost everything. But I never carry a balance, I pay it in full every month. And to boot, my bank/CU pay me (via their rewards programs) to use their cards! Thanks, mr. Banker! :D

Comment by MWR
2017-12-03 18:21:43

Don’t kid your self. EVERY purchase you make nets the bank money even after your “reward.”

Every Credit card purchase has a value to the bank.

Mr. BANKER is make a living off of you wanting “rewards,” even if you pay off the balance in full!

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Comment by SFMF
2017-12-02 15:20:13

Always remember, when it comes to financial issues, the stupid subsidize the smart. The imbecile paying 20% APR, is subsidizing someone who takes the 0% for 18 months and then pays the balance off.

Same with credit cards that have points/cashback. I have the costco credit card that has 4% cashback on gas, 3% on travel and 2% on restaurants and 1% everything else. I put everything I can on that card for the cashback. And it adds up to over $1000 a year in tax free income. How can that possibly be profitable for Visa/Cotsco?

Easy. Interest rate on the card is pretty high, I think 13%. I pay it off in full every month and get the cashback. But for every person like me there are 5 who pay 13% interest, which more than covers the loss of my $1K cashback.

Comment by BlueSkye ⚓
2017-12-02 16:28:22

financial issues, the stupid subsidize the smart…

I don’t spend enough money on crap these days to get back $1000 in credit card rebates over many years even. I think in the past year it has been a little over $100.

I will add that the degenerate borrower puts quite the financial strain on honest folk, by pulling demand forward and thereby increasing the price of everything. Smart or stupid, I’m looking forward to the end of that game.

Comment by Apartment 401
2017-12-02 14:49:10

Denver, 2017:

I don’t live in Denver or pay taxes to Denver. I live in Arapahoe County :)

Comment by jeff
2017-12-02 17:54:20

Will there be an update on that dude’s transition?

I pray he still has a ways to go.

Comment by Rental Watch
2017-12-02 14:49:28

Berkeley is worst than most, but this is a common problem. Politicians use”no growth” stances to win votes–even when such stances are blatantly illegal.

If you don’t think this kind of activity hampers development and reduces supply and/or drives up the price of approved residential land, I’ve got a bridge to sell you.

Comment by Ben Jones
2017-12-02 18:12:11

‘hampers development and reduces supply and/or drives up the price’

I’ve shot this down dozens of times. Not going to bother again.

Comment by BlueSkye ⚓
2017-12-02 18:39:04

When you are living in a mania, a reality check only makes you quiet for a moment. Then you are in a rage or right back to your story like reality never showed itself.

Comment by OneAgainstMany
2017-12-02 19:14:28

I listened to this article on my long run today. This quote from the article epitomized just how out of whack certain housing markets are:

“Then there is Patterson + Sheridan, a national intellectual property law firm that has its headquarters in Houston and recently bought a private jet to ferry its Texas lawyers to Bay Area clients. The jet was cheaper than paying local lawyers, who expect to make enough to offset the Bay Area’s inflated housing costs.”

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Comment by tresho
2017-12-03 10:15:08

The jet was cheaper than paying local lawyers, who expect to make enough to offset the Bay Area’s inflated housing costs.”
Then there are Americans who will travel over the border to Mexico for some dental & medical care that is as good as, but far cheaper than, the same available in the USA. Closer to home, a relative of mine recently discovered some specialized dental care in the Denver area billed for $25,000 there, only cost $12,500 in the Bay area. She only learned that because I advised her to check with the dentist who had done her work 25 years ago when she lived in the Bay area. He was still working in the same office.
Some cardiac care in India is so much cheaper that Americans have traveled to India for procedures, stay a month to recuperate & return home having saved many $1000s even allowing for the extra travel & lodging expenses.
There are probably many stories like these.

Comment by OneAgainstMany
2017-12-03 18:01:24

Medical tourism is huge. I believe there are many good outcomes and competent practitioners in many countries, but it is very difficult to evaluate the quality of outcomes across different countries. International accrediting agencies can help, but in the end it’s about selecting the right clinician within a system that has good outcomes.

I’ve had several patients who went to Mexico and had gastric sleeve (bariatric surgery) and had complications that landed them in the hospital for weeks on end and resulted in their bankruptcy. Obviously, these are anecdotal experiences and don’t represent the tremendous number of successful procedures, but they are eyeopening. I remember one patient who had numerous JP drains with all sorts of foul peritoneal fluid I was draining constantly, a PCA pump. and a PEG feeding tube.

It seems like a big problem is continuity of care. If you don’t have good follow-up care, even small issues can escalate and turn into life threatening ones. Having said that, there is no reason to believe clinicians in other countries aren’t just as trained and experienced as US clinicians.

Comment by Carl Morris
2017-12-04 11:54:37

The jet was cheaper than paying local lawyers, who expect to make enough to offset the Bay Area’s inflated housing costs.

Yup. I specialize in working in the field but can not convince my San Jose employer to let me live somewhere else. Hence my upcoming move to a different employer outside the bay area at the same salary. But not too far away because if anything goes wrong I probably won’t have any choice but to come back for the next job.

The bay area is great for management, elite engineers, and works for H1Bs/new grads who are willing to spend everything on crappy apartments to get a good start. But there is no middle unless you got established in the area years ago.

Comment by Rental Watch
2017-12-03 10:39:31

Local governments are abusing their power so much with respect to land use in CA that the legislature in Sacramento is working on laws to REDUCE government power.

That should tell you something.

Comment by SFMF
2017-12-02 15:05:58

Anyone find it interesting that as Peak Lauer/Conyers/Franken was approaching, and as Trump is about to get his first big win and as the Steinle verdict was making the rounds…….the Flynn story drops. And poof….just like that you will never hear about any of these stories again.

If there is one thing the left does well it’s work together.

Comment by BlueSkye ⚓
2017-12-02 16:35:39

I read something about Flynn just this morning.

Comment by BlackSwandive
2017-12-02 15:48:34

Some opinions and observations on the “Amazon” economy since it’s talked about a lot here given their bloated stock price and how they’re supposedly going to put the nail in the coffin of every brick and mortar which ever existed.

I did some Black Friday shopping because of some good pricing on outdoor clothing. I ordered 6 items from 2 different e-tailers (NOT Amazon) Thanksgiving evening, November 23rd.

9 days later it’s December 2 and I have still only received 3 of the 6, and all showed available to ship when I ordered them. There were 5 separate tracking numbers for the 6 items. 2 of the remaining 3 were shipped UPS, but handed off to the USPS and are listed as “available for pickup” at my local post office as of this morning, the only problem being my local post office is CLOSED on Saturday. So, I have to wait 2 more days until Monday which will mean it took 11 days just so I could try on a few things and hope they are the right fit/color/etc.

Of the first 3 received, 1 is a definite return, the other 2 I am mulling over. The colors are different than shown online, and the fit is slightly questionable.

I think online shopping for clothing stinks. It has taken nearly 2 weeks just to receive the order, and if I wanted to actually return them and get a different size or something else we’re looking at close to a month. And, I’d have to actually buy the items again so I could get them coming rather than wait for them to process a return and then send the right items back, if they even had them anymore. That does not work for me. One of the e-tailers has a physical presence where I can return in-store, the other does not. Whatever goes back will be in lieu of a refund in store. I’m done with the shipping crap.

All in all, I don’t like this process. It would be a lot better if there was a uniform sizing used internationally. There is no good reason why a medium in one brand is the same size as an XL in another brand. Worse, a manufacturers sizing chart is oftentimes wrong for their own items.

Comment by BlueSkye ⚓
2017-12-02 18:40:24

good pricing on outdoor clothing…

At least it was cheaper than actually going outdoors.

Comment by BlackSwandive
2017-12-02 20:51:58

I’m not sure what you mean.

Comment by BlueSkye ⚓
2017-12-03 10:03:37

Sorry. The only thing worse than a failed joke is one that is explained.

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Comment by tresho
2017-12-03 10:09:05

The only thing worse than a failed joke is one that is explained. Had to tell that to a very nice looking lady from Mobile once when she didn’t get one of my jokes. Very tricky to do that without being arrogant.

Comment by BlackSwandive
2017-12-03 10:36:46

It just went over my head, which isn’t the first time and certainly won’t be the last. At any rate, since I have to return some things my fuel costs and time really start to eat into the savings. What was supposed to be a lower cost and more convenient option just became a hassle.

The items I purchased are base and mid-layers which will last me close to 10 years. The positive insofar as online shopping is concerned is the breadth of items I can shop for. No store has all the brands, styles and sizes. That being said, the lack of an industry standard insofar as fit is concerned is really lame. The best thing I have found is when they post video of a person in the clothing with an exact height and weight.

Comment by OneAgainstMany
2017-12-02 19:20:49

I read somewhere that clothing returns is one of Amazon’s biggest problem from a cost standpoint. The labor involved in restocking and processing returns, including customer service contacts is why they are investing in solutions to try to help customers get the size that fits the first time. I’ve noticed that Zappos (owned by Amazon) often displays the “% of customers who says fits as expected” metric prominently. Because sizing is so haphazard, it’s really a crap shoot.

I think Walmart’s acquisition of Bonobos is really the sweet-spot when it comes to melding online with a physical presence. The showcase model is replacing the department store model. Essentially, the customer walks in and gets fitted for a particular apparel item, but then the order is placed online. The benefit for the retailer is that they don’t have to stock every size and color, and there are logistics benefits from being able to still centralize distribution and inventory. The benefit for the consumer is the high-touch customer service and getting the right fit while also maintaining the semblance of a shopping experience.

Apple pioneered this with their retail stores. Tesla does a good job of this too.

Comment by Mr. Banker
2017-12-02 22:36:55

I enjoy hearing stories of women buying expensive dresses, wearing these expensive dresses to la-de-da functions, and then returning these expensive dresses to the store the next day and receiving full refunds.

Comment by redmondjp
2017-12-03 00:40:28

I go to the Vanity Fair outlet store for all of my clothes - I spent almost $500 there last summer and stocked up. NONE of the local stores carry pants that fit me any longer (30/34 to 32/34), but the outlet store has all of them. Decent jeans for $10-20/pair.

I hate clothes shopping with a passion, but darnit when I bring 5 pairs of pants into the changing room and four of them fit perfectly, I can’t help but to smile and buy them.

Comment by OneAgainstMany
2017-12-03 08:57:00

My shopping experiences have changed enormously. I used to worry about dressing up (shirt and tie) and was always stocking up at Men’s Warehouse or Nordstroms. That was when I was in corporate world. But now that I’m an RN, it’s just navy blue scrubs at our hospital. Wardrobe bill is 1/10th of what it used to be.

Comment by tresho
2017-12-03 10:20:45

Wardrobe bill is 1/10th of what it used to be.
After retirement it gets even better. I wear my denim cargo pants now until they become threadbare. However my footwear bill has gone up a lot, since I took up walking 4 miles daily.

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Comment by BlueSkye ⚓
2017-12-03 12:05:55

Being a boat bum is yet another quantum leap down in wardrobe cost.

Comment by OneAgainstMany
2017-12-03 18:07:42

Looking forward to retirement life (hopefully early retirement) and maybe being a boat bum one day. Want to do a travel RN gig in Hawaii in the next year or two…

Comment by Apartment 401
2017-12-02 16:09:08

Eric B & Rakim — Paid In Full (1987):

Comment by azdude
2017-12-02 17:16:47

im having a hard time living on 10k per month.

Comment by Professor 🐻
2017-12-02 18:20:04

Is that pre- or post-tax?

Comment by In Colorado
2017-12-02 20:35:14

You need a HELOC, so you can spend some of that sweet equity. YOLO. right?

Comment by BlackSwandive
2017-12-02 20:59:51

The $10k per month is the HELOC.

Comment by BlueSkye ⚓
2017-12-03 12:07:05

And he has hit his credit limit. Sad, sad days.

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Comment by jeff
2017-12-03 14:43:41

“im having a hard time living on 10k per month.”

Comment by Larry Littlefield
2017-12-02 19:15:30

The deficits of that Republican bill are awful and unjust. Another generational ripoff by Generation Greed.

The only good news concerns the mortgage interest tax deduction. But how good is it?

The House bill caps it at $500,000. The Senate bill keeps it a $1 million. And only for new mortgages, not existing mortgages.

It’s not as if the REIC is going to love these guys with a cut to $500,000. Why not get rid of it altogether?

Comment by butters
2017-12-03 11:54:24

Because the government is run by stupid party.

Comment by jeff
2017-12-03 00:24:12

Man deported 20 times sentenced to 35 years for Portland sex assault

KGW 7:04 PM. PST December 01, 2017

PORTLAND, Ore. — A man with a long criminal history, deported 20 times, was sentenced Friday to 35 years in prison after breaking into a woman’s home last summer.

Sergio Jose Martinez, 31, then sexually assaulted the 65-year-old woman and stole her car. He was arrested after assaulting a second woman and running from police.

Immigration and Customs Enforcement (ICE) lodged an immigration detainer against Martinez, asking authorities to notify them before releasing Martinez to allow ICE to take him into custody. The Department of Homeland Security said a detainer was requested for Martinez in December 2016, but he was released into the community and authorities did not notify ICE.

Earlier this year, Multnomah County leaders and Sheriff Mike Reese wrote a letter to the community saying, “The Sheriff’s Office does not hold people in county jails on ICE detainers or conduct any immigration enforcement actions.”

Prior to the July 24 arrest, Martinez’s criminal record showed a felony conviction for burglary and three misdemeanor convictions for battery, theft, and obstructing a public officer. The court document also said he told investigators in March that he has a long history of using methamphetamine and was currently using on a daily basis.

The new charges Martinez was convicted of include first-degree kidnapping, first-degree robbery (two counts), second-degree assault, first-degree sex abuse, first-degree sodomy and first-degree burglary.

Police said Martinez broke into the 65-year-old woman’s home in the 1700 block of Northeast Irving Street and physically and sexually assaulted her before stealing her 2011 silver Toyota Prius.

Court documents said Martinez entered the woman’s bedroom through a window that she left open due to the heat. He spoke “calmly and quietly,” ordering the woman onto the ground, where he tied her hands and feet, and blindfolded her.

Martinez threatened to kill the woman while he sexually assaulted her, according to the probable cause affidavit. Before he left, he punched her in the head several times and slammed her head onto a wood floor.

Martinez left, taking the woman’s phone with him.

She went to a neighbor’s house to call 911. Police responded to the home just after 6 a.m.

The woman’s car was found that evening near Southeast 99th Avenue and Stark Street.

Later that night, officers were called to a reported disturbance between a man and a woman in the basement of a parking garage near the 2100 block of Northeast Halsey Street.

Police said the Martinez was armed with a knife and he assaulted the woman.

Comment by Professor 🐻
2017-12-03 02:02:21

Never been a better time to be a landlord. Fred Trump would be proud of his son’s achievement to make America’s landlords great again.

Loser: Real Estate Brokers

No more deduction for interest on home equity debt. A $10,000 cap on the deduction for real estate taxes. A new requirement that you own your home for 5 years — rather than 2 — before you can sell it tax-free. It’s not a great time to sell houses for a living.

Winner: Rental Real Estate Owners

It is a great time, however, to be a landlord. For starters, the life over which you can depreciate your property has been reduced — from 27.5 years to 25 years for residential property and from 39 years to 25 years for nonresidential property. In addition, while most other businesses will find their interest deduction limited under the Senate bill, that limitation doesn’t apply to landlords, who can continue to deduct their mortgage interest in full.

Real estate owners will really enjoy a windfall, however, if the final bill adopts the House version of “pass-through” taxation. Under the House bill, all rental income will be subject to a top rate of 25%, as opposed to 39.6% under current law. Under the Senate bill, however, it appears that for those large landlords earning more than $700,000 annually, unless the rental properties or a management company pays out significant W-2 wages, the owners would be stuck paying a top rate of 38.5% on the income, a rate 13.5% higher than under the House bill.

Comment by CorporateShill
2017-12-03 10:23:59

Does this mean that a rational actor would leverage up on debt to replace w2 income with rental income?

Comment by azdude
2017-12-03 05:35:36

Is it the algos or the FED trading desk that has been buying the dips over the past 8 years thus preventing any major selling? Or is a combination of both? GeT SHORTY?

Comment by Professor 🐻
2017-12-03 08:46:42

Damn good question! Any thoughts on how to reveal the answer without relying on conspiracy theories?

You might have to also consider the Treasury Secretary’s possible role, as the Fed is supposed to be independent of the WH, but not the Treasury.

Comment by butters
2017-12-03 11:51:27

It’s all of the above and more. Don’t forget foreign central banks buying our junks and vice versa.

Comment by Professor 🐻
2017-12-03 09:08:01

Great stuff here…

Barack Obama’s one big thing was moving the United States toward a more European model of health care, one in which the federal government would take a stronger and much more direct role. It isn’t that he didn’t know what he wanted: While his heart’s own true desire is a government health-care monopoly (“I happen to be a proponent of a single-payer universal-health-care program,” etc.) he also believed that transitioning to such a program all at once would be disruptive, and so he backed what turned out to be an incompetent attempt at adapting a Swiss-style system of mandates, subsidies, and price controls to American conditions. As a political matter, he’d have signed a four-inch-thick stack of paper containing nothing but endless repetitions of the phrase “All work and no play makes Jack a dull boy!” so long as Harry Reid and Nancy Pelosi got it to his desk with the words “Health-Care Reform” on the title page.

His eight years in office will be remembered as a failure and a great lost opportunity, not least of which because his one big thing, the Affordable Care Act, was such a dog’s breakfast of a bill that it immediately began to unravel. Parts of it conflicted with other laws and with the Constitution. Its underlying economic architecture is a mess, which resulted in substantially higher health-insurance costs for many Americans and fewer choices for many more. Its mandate that individuals buy insurance — necessary to the function of insurance markets under the preexisting-conditions rule imposed by the ACA — was toothless.

Comment by BlueSkye ⚓
2017-12-03 10:08:05

“Pass something. Anything! Save my Presidency.”

Comment by tresho
2017-12-03 10:16:57

As a political matter, he’d have signed a four-inch-thick stack of paper containing nothing…
Sounds very much like the recently passed “tax reform” bill. It will probably turn out to be a dog’s breakfast.

Comment by butters
2017-12-03 11:49:57

Can’t get anything right in DC. It’s too bloated, too big, too complicated. Don’t even bother.

This Tax bill reminds me of Obamacare…..Dems will hang the republicans with it.

Comment by OneAgainstMany
2017-12-03 18:14:01

The ACA was a failure? Tell that to my stepfather who is a retired dentist with chronic back problems and adjunct professor. My mom is an admin for a large tech company (streaming video that powers Sling). They get very affordable insurance. Granted, they probably pay far too little for what they get, but they love the ACA. Both are republicans who voted for DJT.

Sure, ACA has problems, namely it didn’t bend the cost curve. But it has been tremendously successful in 1) disentangling insurance purchase from one’s employer) 2) creating a national insurance market 3) increasing the number of insured Americans.

ACA needs to be fixed, but many people are happy with it.

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Comment by Professor 🐻
2017-12-04 07:56:16

So it is a good program if you happen to be on the receiving end and bad if you are on giving end?

Comment by tresho
2017-12-05 07:48:59

So it is a good program if you happen to benefit personally from it and a bad program if you don’t. FIFY.

Comment by OneAgainstMany
2017-12-05 08:04:06

I would submit that society at large benefits from lowering the uninsured rate and for the ability to have a large market where individuals can purchase insurance not tied to their employer. That pre-existing conditions does not preclude coverage is also hugely important. Whether these benefits justify the costs is a reasonable question to ask. I would submit that they do, but there are ways to make the system more flexible and equitable. Mend it, don’t end it.

Comment by Carl Morris
2017-12-05 10:57:57

I would submit that society at large benefits from lowering the uninsured rate and for the ability to have a large market where individuals can purchase insurance not tied to their employer.

Your second point is the reason that I am willing to consider a single payer utility when normally I lean right on most issues.

If we REALLY want to unleash creativity in this country then we need ALL of the potential next generation Jobs and Gates to be able to work on what really interests them and not be forced into a cubicle or retail just to get health insurance. Back when we were the only game in town the upper middle class geniuses were enough, and if the poor ones drove trucks all their lives so be it. But now that competition is global we need them all.

I watch the young Chinese people trying their hands at everything that strikes their fancy, with basic health care for themselves, their parents, and any kids they have automatically covered. It’s not great care, but it’s enough that they don’t have to choose their occupation because of it. As a result they work harder and try more things, while our kids hang out in college trying not to make a fatal mistake and lose their one chance. Meanwhile we KNOW that successful entrepreneurship requires multiple failures in almost all cases…and right now only our upper middle class can afford to fail.

Comment by OneAgainstMany
2017-12-05 14:20:02

Very profound assessment. I think your thoughts hit the nail on the head. I have shifted my personal feelings on healthcare rather dramatically over the years. I think Elizabeth Rosenthal writes very poignantly on US healthcare and what is likely to improve it (quality and cost), and what is not.

This is why I support universal healthcare. This was not my initial position, but after working extensively in the medical field and squaring my theories with what happens in practice (and comparing outcomes and cost to other countries), it seems like the logical path forward to have greater government involvement in healthcare, not less. Allowing individuals to buy into medicare or medicaid plans would be a significant step forward. Medicare and medicaid are some of our countries most efficient programs in terms of value.

If the US had universal healthcare, it would make our corporations quite a bit more competitive globally. It would also be extremely costly in our current structure. But I feel that this is where we are going to have to go if we want to remain healthy and competitive.

By the way, your comments remind me of this article I read in NYT a few days ago:

Lost Einsteins: The Innovations We’re Missing

Comment by Carl Morris
2017-12-05 15:15:28

Thanks for the link, I hadn’t seen that. The only part of it I question is just the quality of the patents. My guess is that the few lower class kids who do get patents get more valuable ones, but I have no idea if I’m right. All I know is that if you work in corporate tech it’s easy to end up with patents for basically BS stuff if you work for a company that likes to try to patent everything possible. When I see that cluster for Silicon Valley kids I can’t help but raise an eyebrow, thinking a bunch of them grew up to take those kinds of jobs.

I like some form of universal healthcare even if it’s only catastrophic coverage. That might even be the best kind of universal healthcare. Nothing keeps the cost of the common stuff down like everybody paying cash for it.

I see the potential downsides of any universal coverage as:

1. Loss of income and investment for anybody in the insurance industry.
2. Reduced innovation in the covered areas as profit gets squeezed.
3. Potential over-prescribing of covered procedures and medications…just like now.
4. Stupid things like the government not being allowed by law to use purchasing power to squeeze the price of medications…just like now.

But I think it’s worth it for the reasons we are discussing.

Comment by OneAgainstMany
2017-12-05 20:39:07

I see the potential downsides of any universal coverage as:

1. Loss of income and investment for anybody in the insurance industry.

I remember doing a rotation at a family practice pediatric clinic. The doctor was amazing, he truly was. Genuine, caring, and very skilled. I remember before the rotation started I counted like 5 people in the front office. These were not aides, nurses, medical assistants, or anything else. They were just schedulers and part of the billing staff. They handled insurance paperwork. I remember talking to no less than 4 different people on some insurance hotline trying to find out costs for my wife when we had our 1st. The amount of bloat in the insurance industry is staggering. But as they say, one man’s waste is another man’s paycheck…

2. Reduced innovation in the covered areas as profit gets squeezed.

Maybe, maybe not. One problem is that most of the advanced treatments and procedures are often being paid for via insurance, or a 3rd party. This means that the rationing is of care is unlimited (e.g. a consumer’s demand for care is without limit when the other is paying the bill). This is why UK uses “quality adjusted life years” to determine whether a drug or an intervention is “worth it.” In the US, we do not ration hardly at all in this way and patients often opt for the fully Monty, often demanding hundreds of thousands of dollars on interventions and procedures that will maybe only lengthen life by a couple of months and might not improve quality of life. So we probably are getting more innovation and squeezing out a bit more here and there, but I’m not sure it’s very meaningful in terms of quality of life, or is it very utilitarian.

3. Potential over-prescribing of covered procedures and medications…just like now.

I think the best way that I’ve seen to solve this is with cost-sharing (e.g. co-pays). Consumers are quite sensitive to utilization when co-pays are introduced at an appropriate level.

4. Stupid things like the government not being allowed by law to use purchasing power to squeeze the price of medications…just like now.

This one makes me crazy. The pharmaceutical industry is making out like bandits. When I was working in the ER I was talking to one of our pharmacists and he was telling me how Egypt negotiated a 99% discount on Sovaldi ($900 for 12 week treatment). In the US, the same treatment cost $84k. It would literally be cheaper for US medicaid/medicare to fly patients with Hep C to Egypt and let them stay on vacation for 3 months while they receive treatment.

Comment by azdude
2017-12-03 16:49:05

when is the first class action lawsuit claiming market manipulation by burned short sellers going to start?

who is the defendant going to be?

Comment by Ben Jones
2017-12-03 19:22:17

Matt Lauer Caught on Video Telling Meredith Vieira, ‘Keep Bending Over, Nice View’

Comment by OneAgainstMany
2017-12-03 21:47:33

What a creeper.

Comment by rms
2017-12-03 22:04:04

Looks like Meredith takes care of herself.

Comment by azdude
2017-12-04 06:10:29

says whats on his mind?

Comment by rms
2017-12-04 21:31:27
(Comments wont nest below this level)
Comment by tresho
2017-12-05 07:51:03

Actually the pictures in my head have always been so much than the realities I encountered.

Comment by Professor 🐻
2017-12-03 19:37:04

No worries about ever losing a nickel gambling on Bitcoin.
Now there is even a website to warn you when the bubble is about to collapse, which makes Bitcoin investments completely safe!

Comment by BlueSkye ⚓
2017-12-04 05:55:45

Collect your own “cryptokitties”. This looks better than beanie babies. They can breed.

One of those practical applications of that fabulous technology of blockchain that we’ve been told we should invest in. Early adoptors likely to become rich beyond imagination.

Comment by Mr. Banker
2017-12-04 06:20:16

Venezuela is creating its own digital currency. I suggest all HBB readers go all-in. Cash out your home equity if you have any.

Allow no dollar to escape.

Comment by Mr. Banker
2017-12-04 07:25:50

I your Venezuela bitcoin experience does not turn out in your favor it will be my pleasure to offer up to you Back-Up Plan A …

Comment by Professor 🐻
2017-12-03 22:34:20

Has the Fed finished walking back its December rate hike yet?

Comment by Professor 🐻
2017-12-03 23:47:04

Into the trees: Rural housing shortages push some into forests, parking lots
In the country’s losing effort to house everybody, rural Americans are often overlooked. And in Gila County, there are few safety nets.
Alden Woods | The Republic |
Updated 1 minute ago

PAYSON — This place provided nothing, so Doug Stewart tried to prepare for everything. He filled his Jeep with blankets for the cold and tents for the rain, ham-and-cheese sandwiches for the hungry and a full tank of gas to take people out of Gila County. Then he drove to Walmart.

He rolled into the parking lot, past the people who held cardboard signs at eachentrance, past a dozen people who slept in their cars every night. Even more people camped in the woods behind the store, and into the trees walked Stewart, 46, to find Theresa.

A week earlier he drove a man 89 miles to a shelter in Phoenix. The night before, he took another on the 74-mile drive to Cottonwood, bringing both to the homeless services Gila County didn’t yet have. Now there was room at a shelter in Flagstaff, 115 miles away, and Stewart knew who needed it most.

“Theresa!” he yelled. His voice echoed in the trees.

He traced a flashlight over small piles of trash and yoga mats that had become mattresses. He ran his hand along a graffiti-covered wall. Every few feet he passed a camp where somebody had been forced to sleep outside, trapped in a place unable to combat a national crisis.

A shortage of affordable housing struck first in America’s cities, pushing poor renters into suburbs and sleepy outskirts. The shortage ate through those places, too, and it spread farther and farther out, into rural areas like Gila County, where there was nothing to catch people on their fall from housing to homelessness.

In the country’s losing effort to house everybody, rural residents are often overlooked. Seven percent of America’s homeless population lives in rural areas. But the safety nets built into big cities often doesn’t exist outside the metro areas. Rent prices are lower, but so are incomes. The National Rural Housing Coalition found that almost half of all rural Americans spend more than the recommended 30 percent of their income on rent.

“Bleak is probably not the right word,” Payson Mayor Craig Swartwood said in an interview. “But we’re critically in need of more rentals in the affordable area.”

Comment by azdude
2017-12-04 06:14:00

when the service jobs dont pay hardly anything folks dont have a 1000 bucks a month for some depressing apartment.

Would u want to work then hand most of your paycheck over to a slumlord?

Part time , sh@ty service jobs is what the recovery has been.

Comment by OneAgainstMany
2017-12-04 18:11:51

I wish there were a way to selectively hike taxes on corporations based on the number of employees in their ranks that need to rely on federal assistance programs for food, shelter, medical needs, etc. to survive. The fact that many corporations are having record profits while their workers are struggling effectively means that US taxpayers are subsidizing poverty wages.

Comment by Professor 🐻
2017-12-04 07:53:13

Do you plan to dash into cash before the next crash, or wait until the big Boyz on Wall Street pull the plug and get sucked down the drain with the other rubes?

Comment by cactus
2017-12-04 10:28:30

yes why do you ask ?

There is a 70 percent chance of a US stock market correction, according to research conducted by fund giant Vanguard Group.
Several forces are contributing to the much higher than typical risk, including narrowing of the bond yield curve and stretched U.S. equity valuations.
The trade-off between stocks and bonds, or even stocks and cash, doesn’t look as strong as it did earlier in the bull market, following the financial crash.

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